Bally’s points to future developments with largely flat Q3 revenue
The company’s overall revenue total was a 0.4% decline from last year, according to an earnings report released late on Wednesday (6 November). Bally’s casino segment tallied $353.4 million, a 1.6% decline, and its international interactive segment dropped 5% to $231 million despite an 11% jump in UK online revenue.
North American interactive, its smallest division, jumped 54% to $45.7 million. This was due to Bally’s sports betting expansion and igaming monopoly in Rhode Island. Overall, adjusted EBITDA was $137.7 million, down slightly from $141.6 million a year ago.
Through the first nine months of 2024, Bally’s revenue total is $1.87 billion, in line with its total of $1.83 billion at this point last year.
Q3, start of Q4 has been busy for Bally’s
All told, the flat totals are not the worst news for a company that has seen a flurry of developments.
Since the beginning of July, Bally’s was bought out by its largest shareholder Standard General (SG). It announced a wide-ranging financing deal with Gaming and Leisure Properties (GLPI) for its permanent Chicago casino. It imploded the Tropicana to make way for a new Las Vegas casino. And, most recently, it sold off its Asia interactive business.
Company officials largely pointed to these as future revenue drivers and cost cutters. Given that Bally’s will hold a shareholder meeting on 19 November to vote on the Standard General buyout – which includes a merger with SG-owned Queen Casino & Entertainment – there were no comments given on the Q3 call Wednesday.
Casino performance mixed
The company’s casino performance was mixed in Q3, with the highlight being its temporary Chicago property. In prepared remarks, president George Papanier said the casino had eased into a “largely stable cadence”. In its first calendar year of operation, it welcomed 1.3 million visitors, he said.
CEO Robeson Reeves alluded to progress on the $1.7 billion permanent casino, which is scheduled to open in September 2026. After issues with city water pipes led to a significant redesign, Reeves said Bally’s is “in active negotiations” with officials to approve the new master plan. Papanier later added that the GLPI deal has closed the funding gap and “allowed work to progress quickly”.
On the downside for Bally’s, its regional casinos continue to face headwinds. For its Lincoln, Rhode Island casino, this was attributable to local bridge construction that has affected traffic. In Atlantic City, it was attributable to staff turnover during the summer season. And in Kansas City, it was simply lower-than-expected hold. The segment’s adjusted EBITDAR declined 15% in Q3.
Little was said about the company’s Las Vegas development, other than Reeves pointing to “significant planning efforts”. Bally’s chairman Soo Kim confirmed in late October that the plan is to open the first phase of the casino to coincide with the opening of the new Oakland A’s stadium in 2028.
UK continues to lead international performance
With regard to the company’s international business, the UK continues to lead the way. In its Q3 report, the company said its success in the market was “driven by all-time high active customer levels and robust Average Revenue per User metrics”.
In referencing the Asia carve-out, CFO Marcus Glover said on the call that future revenue will be “materially lower”. The revenue that is generated will come from royalties, but decreased costs are expected to make up the difference, he said.
The segment’s adjusted EBITDAR of $90 million was a 5.3% jump year-over-year, despite the 5% revenue decline.
North American digital continues to expand
Despite an adjusted EBITDAR loss of $11 million in Q3, the North American digital segment was most promising. For the year so far, its revenue of $136 million is nearly double that at this point last year ($79 million).
“On balance, we remain very pleased with the ramp in our igaming operations in Rhode Island and results benefited from excellent performance in Pennsylvania during the quarter,” Reeves said in the Q3 report. “However, we were impacted to a certain extent by softness in New Jersey.”
On the call, Reeves said that the Bally Bet platform is set to launch in three more states by year’s end.